US Department Of Education Cancels Student Loans
US Education Department announced on Tuesday, August 16, 2022, that starting on January 1, 2005, it will forgive any federal student debts borrowers had taken out to attend ITT.
208,000 borrowers received a total of $3.9 billion in full loan discharges from its termination in September 2016.
The $5.8 billion loan cancellation for 560,000 former Corinthian Colleges students ranks as the Biden-Harris Administration's second-largest targeted debt relief action for cheated borrowers.
ITT has previously faced legal action from the Biden-Harris Administration and the CFPB for deceiving students and coercing consumers into taking out expensive private loans.
Two additional for-profit universities, DeVry University and the Kaplan Career Institute have also come under fire from the Education Department.
Before its moratorium on student loan payments, interest, and collections expires at the end of the month, the Department of Education made its announcement.
Findings based on internal ITT regulations and records, as well as testimony from former students, staff members, and administrators, led to the Education Department's determination.
The Consumer Financial Protection Bureau (CFPB) also canceled $498 million in private student loans to defend ITT borrowers.
The CFPB sued ITT in 2014 because it coerced students into taking out expensive private loans when it knew most of them would default.
Five years later, the CFPB was successful in getting ITT barred from making or offering student loans.
The Massachusetts Attorney General gave the Education Department proof that Kaplan had falsely claimed that its job placement rate was higher than 70% when it was as low as 25%.
The Massachusetts Attorney General also discovered that Kaplan failed to give borrowers the promised career services.